SPECIAL REPORT

Ugandans Fear Corruption, Theft After Changes to New Public Finance Law

 
 
Ruth Kiswa, 29, a trader at her shop near Kampala, says the government should be allowed to borrow money without parliamentary approval if there is a budget shortfall and it needs to deliver services to Ugandans. Apophia Agiresaase, GPJ Uganda
Uganda

An amendment to a bill intended to protect public funds enables Uganda’s government to get loans from the Bank of Uganda without parliamentary approval. Opponents of President Yoweri Museveni’s National Resistance Movement party say the change could result in theft of public funds, but advocates of the change say it’s necessary for the government to have access to money for emergencies.

KAMPALA, UGANDA – When a bill was presented in Parliament that would allow the government to take money from the national treasury without parliamentary approval, Winfred Kiiza and other opposition members fought it in vain.

The Public Finance Management Act 2015, which was created to ensure prudent use of public funds, was amended in November. Kiiza and other parliamentarians who aren’t members of President Yoweri Museveni’s National Resistance Movement party, which has a majority in Parliament, say that change opens the door to theft of public funds.

Now, Kiiza and others are working to get that change reversed.

“The law helps the government to steal money without reservation,” Kiiza says.  “It is also taking away the power of Parliament of appropriation, checks and balances.”

Corruption was reported to be the most problematic factor for doing business in Uganda in the World Economic Forum’s Global Competitiveness Report 2015-2016.

The law was amended during campaign season. The country is set to go to the polls on Feb. 18 to elect a president and parliamentary members. And without parliamentary oversight of how public funds are spent, some suspect that money could be used in political campaigns.

But government officials say the amendment was necessary for the government to manage financial shortfalls that occur when Parliament isn’t available to approve that spending.

Before its amendment, the Public Finance Management Act, 2015, enacted in March of that year, was seen as a strong safeguard against theft of public funds. It ensured checks and balances and legislative oversight, as well as gender equality, according to Uganda Debt Network, one of the organisations that campaigned against its amendment.

The November act amends five sections of the original bill. Now, the minister responsible for finance can take a loan for treasury operations without getting parliamentary approval, and the  Bank of Uganda can guarantee those loans.

Activists say the changes weakened the law and undermined the powers of Parliament.

“What then is the role of Parliament if they are giving their powers away?” says Adellah Agaba, communications officer for Uganda Debt Network.

expand image
expand slideshow

Tom Rukiroru, a carpenter, at his workshop in Kampala. He says that allowing the Bank of Uganda to loan money to government without parliamentary approval will fuel corruption in the country.

Apophia Agiresaasi, GPJ Uganda

That organization and other anti-corruption groups under the umbrella of the Civil Society Budget Advocacy Group unsuccessfully lobbied parliamentarians to reject those amendments.

In an online petition, the Civil Society Budget Advocacy Group compared the changes to giving the government a blank check.

Even more worrisome was the timing, Agaba says.

“Everyone is asking, ‘Why now? Is it because of elections? Is the government broke?’” she says.

Parliament was called to convene during campaign season to debate the bill.

Some Kampala residents fear the law will allow theft of public funds.

“The government has been stealing taxpayers’ money but now that they can get money without Parliament’s approval, it will even be worse,” says Tom Rukiroru, a carpenter in Kiwatule a neighborhood in Kampala.

Everyone is asking, ‘Why now? Is it because of elections? Is the government broke?’”

Uganda scored 25 out of 100 on Transparency International’s Corruption Perceptions Index 2015, ranking it 139, along with five other countries, out of 168 countries and territories. Corruption was reported to be the most problematic factor for doing business in Uganda in the World Economic Forum’s Global Competitiveness Report 2015-2016. That same report ranks the country 125 out of 140 for irregular payments and bribes and 86 out of 140 for public trust in politicians.

Kasaija, the finance minister, insists that the change is necessary, especially for times when Parliament is in recess.

“In case of emergencies, the government will still be able to deliver services,” Kasaija says.

Margaret Baba Diri, a parliamentarian who is a member of Museveni’s ruling party, agrees.

“In some instances, monies are needed urgently to resolve a crisis thus there is need for the government to obtain money from the Bank of Uganda or borrow it and seek retrospective approval from Parliament,” she says.

Baba Diri says the ruling party has not amended the law to obtain money for its campaigns.

“We have enough money to run our campaigns,” she says. “It is just a coincidence that the amendment proposals were brought during the election season.”

But opposition members haven’t given up. Kiiza is campaigning for re-election as women’s representative for Kasese district. If she makes it back to parliament, she will move a motion to repeal the new law, she says.

“By all means I will be part of the next parliament and that is what I plan to begin with,” Kiiza says.